Proponents of Online Self-Regulation Disadvantaged by Inability to Regulate Themselves

Industry Demonstrates Repeatedly It Can't Be Trusted on Privacy

The first concerns that toilet-bowl cleaner 2000 Flushes. I am able to get three, four thousand flushes out of it. I also have the ability to see through Formica. (Unfortunately, I cannot see through particle board.) My greatest gift, however, is the limited power to presage the future. Here are some predictions you can take to the bank:

Over the next 30 days, stock prices will be volatile. Tropical storm activity will originate in the south Atlantic. And, finally, when Congress returns from recess, internet publishers, advertisers and agencies will face the wrath of the United States Senate. Broken industry promises about safeguarding consumer privacy will yield demands for legislative and regulatory remedies, putting at grave risk the fragile business models undergirding the digital economy.

And no wonder. The industry has demonstrated yet again that it cannot be trusted.

The latest alarms come from a pair of academic studies, one from UC Berkeley and the other from Carnegie Mellon. CMU's CyLab researchers conducted several experiments with Facebook's facial-recognition software, and demonstrated how it could be easily used to gather personal data on random passersby, to "out" users of anonymous dating sites and to facilitate identity theft.

"Ultimately, all this access is going to force us to reconsider our notions of privacy," CMU Associate Professor Alessandro Acquisti told the press. "It may also affect how we interact with each other. Through natural evolution, human beings have evolved mechanisms to assign and manage trust in face-to-face interactions. Will we rely on our instincts or on our devices, when mobile phones can predict personal and sensitive information about a person?"

Facebook, ever sensitive to the larger societal concerns springing from its features and applications, has countered that the creeped out can always opt out. One wonders how that sort of arrogance and indifference will play with Sen. Al Franken, D-Minnesota, and Rep. Ed Markey, D-Massachusetts. No, actually, one does not wonder at all.

On the other hand, arrogance is nothing next to actual clandestine activity -- the very thing revealed by Berkeley researchers about a web-tracking start-up called KISSmetrics and such major publisher clients as Hulu and Spotify. Turns out that KISSmetrics is able to track even those internet surfers who have blocked cookies as a means to maintain their online privacy. Worse, it assigned each browser a sort of virtual ultraviolet stamp -- invisible to the naked eye, but detectable no matter where online the user traveled. Yes, even as the industry has congratulated itself for facilitating the "Do Not Track" option, major players were surreptitiously evading it. (See: "False sense of security.")

Nice work, morons. Way to strangle the goose that lays the golden egg.

None of this could have been happily received by the Interactive Advertising Bureau, the trade group dedicated to establishing industry standards, encouraging best practice and, most of all, keeping Washington off everybody's backs. Can you see how the proponents of self-regulation are disadvantaged by the embarrassing inability to regulate themselves?

"Of course our job gets more difficult as the spotlight continues to shine brighter in Washington on our industry," understated Mike Zaneis, general counsel and chief lobbyist for the IAB, who chatted with me in my "On the Media" capacity.

"It certainly is revealing of some questionable business practice, there's no question about that . . . . The key for the industry is not always to think of what can it do but what should it do with a new technology."

So far, so good. That nicely covers the portion of my premise he bought into. Thereupon he went all lobbyist on me, citing IAB's proactive efforts to anticipate and respond to privacy concerns, its soon-to-be-released code of conduct applying to its 470 members, its role in educating consumers and official Washington on the economics of the internet and its -- excuse the oxymoron, please -- robust apparatus for self-regulation. He even hauled out the "one rotten apple" argument.

"You can always highlight a company or a practice that falls without the mainstream of the industry," he observed. "This is certainly not something that is used across the industry as a common business practice."

That, of course, may well be true. It may well, also, be untrue. If the IAB actually knew what its membership and the thousands of non-member vendors were up to, it wouldn't be in the political fix it is in now. For all Zaneis knows, KISSmetrics is the tip of the iceberg. Facebook is an iceberg all to itself.

"We have a pretty good pulse on the industry," he asserts.

But on the heels of the iPhone location-tracking scandal, Google's street -view wireless eavesdropping and the effortless personal-data hacking exploits of Anonymous and Lulzsec, there's no need to take that claim to Capitol Hill.

Might as well just flush it down the toilet, about 4000 times.

ABOUT THE AUTHOR

Bob Garfield, now a consultant, has reported on advertising, marketing and media for 28 years.